A merger between Lakeland HealthCare and Community Hospital Watervliet aims to close by Dec. 1, after directors at both hospital gave their approval this week.

Under a merger proposal, the 58-bed Community Hospital will become a wholly owned subsidiary of Lakeland HealthCare. Directors at the two Berrien County hospitals approved the merger on Wednesday.

The St. Joseph-based Lakeland HealthCare has also committed to making needed upgrades at Community Hospital, including expanding the ER, renovating patient and public areas and converting to private rooms. Those and other investments could reach $10 million over 10 years, according to preliminary estimates.

“Our new partnership will help ensure a continuum of care for all residents of Southwest Michigan for generation to come,” Lakeland HealthCare Board of Directors Chairman Don Hopp said.

The Watervliet hospital will change its name to Lakeland Community Hospital, Watervliet.

A merger will also generate needed economies of scale at Community Hospital, create an improved cost structure and boost the quality of care in Watervliet, he said. It’s structured to allow the two Berrien County hospitals to build on “what’s working well and how do you work collaboratively to enhance what needs some additional resources,” Hamel said.

The merger comes more than two months after the two started integration talks that Community Hospital triggered when it issued an RFP last summer for a strategic partner.Directors in August chose Lakeland HealthCare and began integration talks in September.

The two decided to pursue a full asset acquisition and merge because it would provide the greatest flexibility in integrating operations and working together to make improvements, where they are needed, Hamel said.

The proposed merger structure includes retaining a local board in Watervliet for Community Hospital.

“As we manage through health care reform, the insight and guidance of the Lakeland corporate Board of Directors will be valuable in ensuring our continued success,” Community Hospital Watervliet Board of Directors Chairman Joseph Barrett said.